Top Crypto Fund of Funds on the Current Crypto Cycle, Hedge Funds, & VCs | Pure Crypto LP
Timestamps are as accurate as they can be but may be slightly off. We encourage you to listen to the full context.
Podcast Summary
In this episode of Other People's Money, hosts Jeremy Boynton and Zach Lindquist, managing partners of Pure Crypto, share insights from their crypto fund of funds that has delivered over 11x net returns since inception. The duo discusses the current crypto market cycle, the impact of ETFs and digital asset treasury companies reshaping market dynamics, and why they believe we're in the third quarter of an elongated cycle that could peak in summer or fall 2025. (00:39) They explore the challenges facing crypto fund managers in 2025, where Bitcoin has dominated performance while other assets have struggled, and examine how institutional adoption through ETFs is fundamentally changing the investment landscape. (00:27)
- Main Theme: Navigating the evolving crypto investment landscape as institutional adoption reshapes market cycles and creates new opportunities for sophisticated allocators
Speakers
Jeremy Boynton
Managing partner of Pure Crypto, a crypto fund of funds founded in 2018. Jeremy brings experience from running a multifamily office and has deep expertise in alternative investments. He was initially skeptical about the Internet during college but learned from that experience to recognize transformational technological advancement opportunities, leading him to dive deep into crypto research starting in March 2017.
Zach Lindquist
Managing partner and co-founder of Pure Crypto alongside Jeremy Boynton. Zach has been instrumental in the fund's capital raising efforts and portfolio construction. He focuses on maintaining disciplined communication with investors and has helped Pure Crypto weather multiple bear markets while delivering exceptional returns through concentrated allocations to top-tier crypto managers.
Key Takeaways
Focus on Full Market Cycles, Not Annual Performance
Pure Crypto operates with a full market cycle perspective of four to five years rather than focusing on annual returns. (03:04) This approach is crucial in crypto because the majority of outperformance doesn't come in years like 2025 where Bitcoin dominates. Instead, superior managers prove their worth over complete bull and bear market cycles. This long-term view allows investors to weather periods of underperformance while positioning for significant gains when market conditions favor active management over holding Bitcoin alone.
Market Structure Is Fundamentally Changing Through Institutional Adoption
The advent of Bitcoin ETFs and digital asset treasury companies has created a new class of marginal buyers who now move markets. (00:27) This shift from retail to institutional participation is elongating traditional four-year cycles and creating different market dynamics. ETF buyers have experienced the best performing ETF launch of all time, and this success is driving capital rotation from Bitcoin to Ethereum and soon Solana. The experts predict that over the next twelve months, the entire market will become indexed with ETF products for virtually every major cryptocurrency.
Bear Market Experience Creates Irreplaceable Manager Value
Pure Crypto values managers who have navigated bear markets because these experiences teach crucial lessons about capital management, avoiding leverage, and respecting counterparty risk. (23:00) New managers who haven't managed other people's money through a bear market lack this essential education. The firm started with five core managers and reduced to three, sticking with crypto-native allocators who understand the deep science, open source coding, and cryptography that underlies the technology. This experience-based approach has proven superior to allocating to traditional finance converts who lack the native understanding of the ecosystem.
Venture and Liquid Crypto Investing Are Converging
The distinction between venture and liquid crypto funds is blurring as liquid funds create venture side pockets while venture funds allocate portions to liquid opportunities. (27:02) Everything in crypto operates like venture capital since most projects are pre-revenue startups, even when they conduct ICOs. However, crypto venture offers superior risk-adjusted returns compared to traditional venture because of faster liquidity events - investors can achieve 1000x returns in four years or less, versus the decade-long timelines in traditional venture. The key advantage is the ability to take profits during market euphoria even on projects that may ultimately fail.
Real-World Utility Is Emerging Beyond Financial Speculation
Genuine utility is developing in areas like DeFi, which aims to disrupt traditional financial services by eliminating middlemen and reducing costs. Stablecoins will merge credit card, bank, and brokerage accounts into unified applications offering yield-bearing cash and nearly free transactions. (55:44) Infrastructure projects like Helium demonstrate transformative potential by building networks at a fraction of traditional costs - Helium created a 5G network so effectively that major carriers now rent their infrastructure. Similarly, HiveMapper is revolutionizing mapping by using existing drivers with dash cams to create constantly updated maps superior to Google's six-month-old data.
Statistics & Facts
- Pure Crypto has delivered over 11x net returns since inception through 2024, making it the best performing fund on Prequen according to the hosts. (02:08)
- The Bitcoin ETF launched in January 2024 became the best performing ETF of all time, driving significant institutional adoption. (05:16)
- During their first fund cycle from 2018 to 2021 peak, Pure Crypto experienced three separate 1000x investment returns. (31:51)
